One of the rippling effects of COVID-19 pandemic is the surge in demand for online food delivery services. According to internal data from Google, searches for “food delivery services” have increased by 300% as compared to the last year since the Coronavirus began. With a massive increase in the number of food ordering app downloads, many food tech biggies are currently dominating the online food industry. Uber Eats is one of them.
Uber CEO Dara Khosrowshahi revealed in an interview that Uber Eats saw a 10% increase in the number of self-serve signups by the US restaurants in the first week of March.
As per the recent reports by Statista, Uber Eats came first in France with a 55% market share during the first two weeks of March.
Uber Eats has reportedly seen a 30% increase in the number of people signing up for their food delivery service since lockdown.
According to a spokesperson at Uber Eats, the company saw a 20% increase in the number of restaurant contracts in Japan in April as compared to the previous month.
This dramatic upsurge has developed a keen interest among restaurateurs to build a food delivery app like Uber Eats. If you have a plan to start an online food delivery service amid the COVID-19 crisis, then this guide will give you an in-depth insight into how to create a food ordering app as successful as Uber Eats.
Business Model of Uber Eats
Since its inception, the technology-driven business model of Uber Eats has inspired budding entrepreneurs to start their online food delivery business. The Uber Eats app plays dual roles: it’s a restaurant aggregator as well as a delivery agent.
Uber Eats uses an aggregator model that lists the partner restaurants in the app. This traditional food delivery model enables customers to ask for a food delivery request which is viewed by the restaurants to complete the order. The order delivery is fulfilled by the restaurants itself.
The company supports partnering restaurants with complete logistics support. The food ordering giant uses its logistic network to deliver orders from restaurants that don’t have resources or bandwidth to provide food delivery to their customers.
How Does Uber Eats Work?
Uber Eats is a three-way marketplace that connects restaurants, customers and delivery agents. Multiple restaurants list their brand and menu on the app. The customers search for the restaurants located in their area and place the order. The delivery boy picks up the order from the restaurant and delivers it at the customer’s doorstep.
Uber Eats Key Players
Restaurants: Restaurants manage food orders and update menus on the app by marking food items available/unavailable. They can change the restaurant name, contact information and opening & closing hours as per their availability. They can also decide the price of each item displayed on the menu.
Customers: Uber Eats provides the following ordering options to its customers:
Real-Time Ordering: The customers choose the food items of their choice from the list of restaurants available in the locality. It is a very useful feature for those who wish to receive their food immediately after placing an order.
Custom Ordering: The customers schedule their orders in advance as per their convenience. They can customize their orders with respect to the delivery date, destination address and time.
Delivery Agents: Uber Eats delivery boys are independent individuals who pick up food from the restaurants and deliver it to the customers’ address. They can accept or reject the order request and manage multiple deliveries at a single time. They get the delivery tasks on the basis of their location and proximity to the customer as well as the restaurant.
Revenue Model of Uber Eats
Uber Eats generate revenue through the following monetization methods:
Delivery Fees from Customers
The delivery charges are divided into three categories:
Delivery Fee: The customers pay a small amount of delivery fee that depends on location and the availability of couriers. The total charge may vary from 1$ to 5$ depending on the market in which the company is operating.
Service Fee: Uber Eats charges service fees of 15% of the order’s subtotal.
Order Fee: A small order fee of $2 which is charged if the order amount is less than $10.
Optional Subscription Fees from Customers
The company has an optional subscription model to earn money. Customers have the option to pay a monthly subscription fee of $9.99 to avail the “Eats Pass”. It allows subscribers to get 5% off on the orders over 15%, with no delivery fee.
Commission Fees from Restaurants
Uber Eats cuts 15 to 40% of the total value on each order fulfilled from the restaurant partners. The cutoff percentage is decided based on maturity and hold of the restaurant in the market.
Advertising Fees from Restaurants
The restaurant pays an advertisement fee to the company to come up at top searches on the app and to get more traction & sales. The company earns money by giving restaurants a place in the featured section of the app.
Now that you’ve got a deep understanding of Uber Eats’ statistics, business model, and how does the food delivery company generate revenue. Let’s gain insights into how you can develop a food delivery app that can surpass Uber Eats.
A Step-by-Step Guide to Develop a Food Delivery App
Building a food delivery app like Uber Eats is a challenging task that involves putting together a lot of components. Therefore, having a clear roadmap on coming up with your food delivery app is necessary to make a mark in the online food industry. Taking Uber Eats as an example, we have explained some vital steps that restaurateurs must follow to start similar online ventures.
Step 1: Conduct Market Research
The first step when creating a food delivery app is to research deeply about your competitors, target audience and the latest food industry trends. To get a solid grasp of the current market situation, you must find answers to the following questions:
Who are your competitors and what kind of services they are offering to their customers?
Who are your target customers?
Which features you must include in your food delivery app to steal the spotlight?
What are the hot trends in the online food industry?
Step 2: Select Food Delivery Model
After conducting thorough market research, the next step is to choose a food delivery model that can meet your business goals as well as customer’s demands. There are two types of food delivery model:
Order & Delivery Model
Order-Only model vs Order & Delivery Model: Key Differences
Order & Delivery Model
Food delivery platforms are responsible for accepting and managing the order.
Delivery platforms are responsible for managing and delivering orders.
No logistics support as the delivery is handled by the restaurant itself.
Comes with logistics support. The delivery is handled by the food delivery platform.
Order only platforms generate revenue by charging commission fee to the partnered restaurants.
Order and delivery model earn money by charging commission fees to the restaurants and delivery fee to the customers.
Deivery.com, Just Eat
Step 3: Choose Prominent Features of an Uber Eats like App Service
Here are some must-have features you should include in your food delivery app to get an edge over your competitors:
Delivery boy app
Multiple Payment Options
Ratings & Reviews Management
Multiple Deliveries Management
Support and Assistance
Discounts & Offers
Reviews & Ratings
Step 4: Leverage the Power of Right Technology Stack
When it comes to building an app like Uber Eats, selecting the right technology stack is very crucial as it forms the foundation for providing seamless user experience. You might need different technologies depending on the business model of your food delivery startup. Below listed are some essential technologies to build a food delivery app similar to Uber Eats:
Web App Development AngularJS or React
Mobile App Development| Kotlin (Android) and Swift (iOS)
Back-End Development PHP
Step 5: Pick a Feasible App Development Option
Once you decide the features and powerful technology stack, you must finalize the viable option to build your food delivery app as per your requirements. There are two options:
Hire an App Development Team
You might need the following members to build a successful food delivery solution:
Use a Ready-Made Solution
If you want to build your food delivery app in a shorter time period, then picking a ready-made solution could turn out to be the best option to get your food delivery business started.
How Much Does It Cost to Develop an App like Uber Eats?
The final cost of developing a food delivery app like Uber Eats may vary depending on the following factors:
It is one of the major factors that play a crucial role in depicting the cost of your food delivery app. The size of an app depends on app complexity and the number of features you want to incorporate your app. The more the features you will include, the higher the price will be.
Another factor that influences the development cost is app design. Your food delivery app will not garner enough eyeballs without an attractive user interface. Therefore, the cost will highly depend on the app theme and eye-catchy graphics.
The choice of platform for building a food delivery app also decides the development time and cost. Android and iOS are two major platforms available in the app development market. The price could vary based on the platform you select to create your app.
App Development Team
Be it a freelancer, mobile app development agency or in-house developers, your app development cost will rely heavily on your app development team you hire to develop your food delivery app.
Uber Eats USPs: Features That Gives it an Edge Over its Competitors
Here are some unique features that make Uber Eats an interesting variant of online food delivery businesses:
Shorter Delivery Time
The ability to provide quicker deliveries is something that sets apart Uber Eats from its competitors. The company keeps a track on the preparation time taken by the restaurant which helps them provide faster delivery service.
A general concern that many customers face while placing an order is location eligibility. Uber Eats has taken care of it. The company delivers at places like hospitals, parks, homes, offices, etc. where a consumer may face delivery issues.
Uber Eats has an in-built feature of Self-Pickup. The company allows users to place an order and schedule an in-store pick-up as per their comfort.
This Uber Eats feature enables users to schedule an order in advance. Customers can also track their orders throughout the delivery process to get it delivered at their preferred location and time.
Time to Create an App like Uber Eats!
The Coronavirus outbreak has skyrocketed the demand for Uber Eats like food delivery services. This is a crunch time for restaurateurs to make a mark in the online food industry. Building a food delivery app considering the business model, revenue model, features, tech stack and other essential factors in this blog post will definitely give you a perfect start in the online food industry.
Rest, if you are thinking of launching your online food delivery app within a shorter time span, then you can opt for a custom mobile app development company like FATbit Technologies.
If you have any queries regarding the information shared in this blog post or need expert advice to build a food delivery app, please feel free to drop a message in the comments section below.
Develop a User-Centric Food Ordering & Delivery app like Uber Eats